Federal judge recalls VW's glory years before imposing US$2.8b fine

Detroit court hands down judgement on German brand's emissions scandal.

Federal judge recalls VW's glory years before imposing US$2.8b fine

For a moment on Friday, U.S. District Court Judge Sean Cox grew wistful about Volkswagen's past.

That was before Cox imposed a US$2.8 billion ($3.7b) criminal fine that is part of a larger US$4.3 billion ($6.8b) plea agreement with the U.S. Department of Justice that includes civil penalties.

Before he characterized the automaker's actions as "massive fraud."

And before the judge said he hopes that both U.S. and German investigators continue to investigate top Volkswagen executives and pursue additional criminal charges.

Before all of that, Cox paused for a moment and said he recalled a time when Volkswagen occupied a more prominent place in the U.S. automotive industry.

"This is a very serious and troubling case involving a very iconic automobile company," Cox said from the bench in federal court in Detroit.

In the 1960s, sales of the Volkswagen Beetle grew into the hundreds of thousands as it captured the attention of Americans. When the Beetle was at its peak in 1970, VW's U.S. sales topped out at 570,000 vehicles, according to the Los Angeles Times.

The Beetle was viewed as a lovable, thrifty car for the budget-conscious buyer.

"I just remember VW's reputation, at least in our community, growing up - the quality of the product and the structure of how the car company operated," Cox said Friday. "It was a leader in its field."

The way Cox viewed it, Volkswagen's history made its transgressions even worse. Volkswagen spent the better part of a decade developing software for a diesel engine that was able to cheat on federal greenhouse gas emissions tests. Essentially, the engine performed one way during laboratory tests and another way when it was actually being driven on the road.

Drive Comments

DJM61 | 24 Apr 2017 01:28

Lucky for VW diesel engined passenger vehicles are not popular in the USA. Now in Europe ...

Titan | 24 Apr 2017 01:38

The fraud was perpetrated by a small number of individuals within Volkswagen, not by Volkswagen as a single discrete entity. Most employees and shareholders knew nothing about it until it was exposed.
But they are the ones that will suffer, along with many suppliers, not just from the massive fines, but also the cost of recalls and loss of sales as a result of the scandal. So is this just? The punishment should be directed to the guilty individuals responsible with stiff jail terms, not innocent parties.

Circling Buzzard Titan | 24 Apr 2017 11:16

Get real, yours is arguably the most illogical assessment of VWs massive calculated fraud.
Do you seriously think those implementing deceitful practices will share this info?
VW's fraudulent claims about emissions were to cheat and gain a marketing advantage against competitors.
VW deserves to feel the full force of the law in every jurisdiction, even if it sends them to the wall.

Titan Circling Buzzard | 24 Apr 2017 13:23

And to hell with the vast majority of employees and share holders that knew nothing about it? What are they, just collateral damage? That's the same as saying all North Koreans deserve to be punished for their dear leaders insane actions. How would YOU feel if you were a VW shareholder? Oh well, I deserve to lose my money even though I didn't know what was going on? YOU get real.

Roger Ng | 24 Apr 2017 04:03

Volkswagen spent the better part of a decade developing software for a diesel engine that was able to cheat on federal greenhouse gas emissions tests.
There are people now suggesting that it was a small group of bad eggs. If that's the case, then it's even more troubling that they escaped management oversight for a decade. I don't believe that for one moment.
Somehow, dishonesty was allowed to infiltrate the VW culture and I'm not sure it's yet been excised. C'mon VW back your product and do what Jeep has done. Increase your warranty on new vehicles to 5 years. Then people may just be able to buy what you're selling (both in a vehicular sense and verbally).

Circling Buzzard Roger Ng | 24 Apr 2017 11:18

Given Jeeps record of warranty issues extending their warranty is a braves move indeed?

captain_picard | 24 Apr 2017 05:39

The people attempting to make out it was a small group of emplyess are simply paid advertisers. We should not be in any doubt that VW has the most corrupt culture of any company. VW has been fined countless times over several decades by the European Trade Commission for one violation after another. The corruption comes from the top and all are involved. Most people need to be aware that VW sent letters out to their Australian dealerships outling how to mine customer wallets during servicing. Trust them if you want - but at your peril. My hunch is that they have dreamed up other frauds to perpetrate once the heat is off. How else to you recover billions of dollars in fines. The directors as with all fraud should go to prison. Its the only way to stop these criminals from acting with impunity. I agree the shareholders should not have to pay. The other way to solve the issue is don't buy their cars! That's when they'll know the community won't accept being defrauded and the environment being rapped. Think about it Porsche/Audi/Skoda/VW owners. Those diesel particulates are toxic!!! Now lets see what the Australian Law can do to them?